4 ms·

So sounds like this will be a great short candidate after the index re-weighting.

by dweez 7mo ago

bagacrap 7mo ago
What, QQQ or SpaceX? Either way, no, high frequency trading firms are going to beat you to the punch. And shorting elons other company, just because it's over valued by traditional metrics, didn't work out that great for most traders.
- dweez 7mo ago
  This is a slightly tongue-in-cheek way of saying that if you believe a security is severely mispriced then there is a straightforward way to express that opinion.
  - bagacrap 7mo ago
    Shorting is really not that straightforward. It is a avery advanced topic because it mandates the use of leverage. Many (most) investors are long-only, especially the ones being taken advantage of here.
    - Retric 7mo ago
      > especially the ones being taken advantage of here. This is a great argument why buying an index is a poor choice for a long term investor. You can avoid a great deal of shenanigans by randomly purchasing stocks and holding them for 50 years. Even a 0.02% annual fee costs you 1% of your long term returns over that timescale. But there’s tradeoffs to everything.
      - bagacrap 7mo ago
        Index investing is a great choice for a long term investor who cares about simplicity, which should be the vast majority of them. Actually the best thing about holding individual stocks is probably the increased opportunities for TLH, but the nightmare of holding and managing hundreds of securities in your account is very seldom worth what you save on fees or deferred taxes.
        Retric 7mo ago
        You still owe the taxes on dividends generated by an index fund that automatically reinvests dividends. There’s ways around this like a 401k, but you can also own individual stocks inside a 401k or rollover to an account that lets you do so.
        bagacrap 7mo ago
        I don't know how that's a response to what I wrote. I'm not saying that an ETF is more tax efficient, although it is more tax efficient than a mutual fund. If you are worried about the tax drag of dividends then there are ETFs that seek to track spx, but without receiving dividends, by selling and rebuying around ex div dates. They're not established enough to trust with a lot of money, imo, but maybe it will become more normal one day.
    - mlrtime 7mo ago
      https://www.proshares.com/our-etfs/leveraged-and-inverse/psq https://www.proshares.com/our-etfs/leveraged-and-inverse/psq This is not financial advise.
      - bagacrap 7mo ago
        And I'm sure there will be an inverse SpaceX ETF too. This still crosses the Rubicon from "investor" to "trader".
cmcaleer 7mo ago
Tesla has been this for a long time since the price fundamentally does not reflect the quality or future of the company, yet the road is littered with dead Tesla bears. Efficient markets hypothesis breaks down with Musk companies.

So sounds like this will be a great short candidate after the index re-weighting.

by dweez 7mo ago

So sounds like this will be a great short candidate after the index re-weighting.

What, QQQ or SpaceX? Either way, no, high frequency trading firms are going to beat you to the punch. And shorting elons other company, just because it's over valued by traditional metrics, didn't work out that great for most traders.

dweez 7mo ago
This is a slightly tongue-in-cheek way of saying that if you believe a security is severely mispriced then there is a straightforward way to express that opinion.
- bagacrap 7mo ago
  Shorting is really not that straightforward. It is a avery advanced topic because it mandates the use of leverage. Many (most) investors are long-only, especially the ones being taken advantage of here.
  - Retric 7mo ago
    > especially the ones being taken advantage of here. This is a great argument why buying an index is a poor choice for a long term investor. You can avoid a great deal of shenanigans by randomly purchasing stocks and holding them for 50 years. Even a 0.02% annual fee costs you 1% of your long term returns over that timescale. But there’s tradeoffs to everything.
    - bagacrap 7mo ago
      Index investing is a great choice for a long term investor who cares about simplicity, which should be the vast majority of them. Actually the best thing about holding individual stocks is probably the increased opportunities for TLH, but the nightmare of holding and managing hundreds of securities in your account is very seldom worth what you save on fees or deferred taxes.
      - Retric 7mo ago
        You still owe the taxes on dividends generated by an index fund that automatically reinvests dividends. There’s ways around this like a 401k, but you can also own individual stocks inside a 401k or rollover to an account that lets you do so.
        bagacrap 7mo ago
        I don't know how that's a response to what I wrote. I'm not saying that an ETF is more tax efficient, although it is more tax efficient than a mutual fund. If you are worried about the tax drag of dividends then there are ETFs that seek to track spx, but without receiving dividends, by selling and rebuying around ex div dates. They're not established enough to trust with a lot of money, imo, but maybe it will become more normal one day.
  - mlrtime 7mo ago
    https://www.proshares.com/our-etfs/leveraged-and-inverse/psq https://www.proshares.com/our-etfs/leveraged-and-inverse/psq This is not financial advise.
    - bagacrap 7mo ago
      And I'm sure there will be an inverse SpaceX ETF too. This still crosses the Rubicon from "investor" to "trader".

cmcaleer 7mo ago

Tesla has been this for a long time since the price fundamentally does not reflect the quality or future of the company, yet the road is littered with dead Tesla bears. Efficient markets hypothesis breaks down with Musk companies.